The Royal Commission on Unemployment Insurance
THERE is no graver question before the country to-day than what action is to be taken on the first Report of the Royal Commission on National Insurance. We have been employing a system which for some years has been notoriously unsound in the eyes of every actuary. We were sorry when the Parlia- mentary Committee representing all parties, after getting to work on what was too difficult for one party to tackle, was suddenly shelved and a Royal Commission appointed. Any delay seemed lamentable. However, we see the advantage of an entirely non-political Commission; and it has wasted no time. There were no politicians upon it ; and no politicians, as such, gave evidence except the favoured Independent Labour Party, though the General Council of the Trades Union Congress can hardly escape being reckoned nowadays as a political body, and its evidence was carefully considered. Mr. Clay, the economist, and Mr. Trouncer, the actuary, sign the Report, but naturally add a note to say that the relief of the burden on the national finances might reasonably have been carried further. Two members present a Minority Report in which they agree that the finance of the present scheme is disorganized, and with the proposals for dealing with intermittent workers. But they would not take all the action proposed by their colleagues, and none of it until the final Report has been considered and issued. We, too, have no liking for two bites at this cherry, but the need either to reduee expenditure or to find new sources of money to meet it (towards this the Minority gives is no help) is of a terrible urgency which would excuse no delay.
The Commission has a great opportunity before it in. its full Report. Time after time we have seen the repetition of history in the administration of what is called the " dole "—a quite improper term so long as it was benefit under a true insurance scheme. It has come to be, in its rank economic unsoundness and in many of its direct and indirect effects, the living counter- part of the Poor Law Relief of a century ago. From the end of the Napoleonic Wars until 1834 relief was supposed to save the poor from starvation when out of work. The suffering after the Great War has been far less intense ; thank Heaven for that. Independence and energy were sapped, rights were claimed where responsibilities and duties were avoided. Employers looked upon relief as a subsidy in aid of wages, as we are told happens to-day ; and so on. The Report of 1884 is too well known to all who care for social conditions to need quotation; apt as it is in a hundred ways to-day. Ruin and bankruptcy seemed inevitable, as the demoraliz- ation, when the Report recommended a surgical operation as alone able to save the patient's life. The country recognized the truth : that the Report was a charter of British freedom and independence. Parliament legislated on its recommendations and saved the country. Self-respect returned, idle consumers became producers, money saved from unproductive " doles " went into productive enterprise, employment steadily increased, and the Victorian era of material prosperity began. With all its drawbacks, as seen to-day, that prosperity was the greatest ever achieved by any nation in so short a time.
Can the country face another, a milder, surgical operation no* ? Is there enough faith that it would succeed ? The Russians are said to be enduring untold hardship in faith that their five-year plan will reward them. The Germans are suffering more hardly than we are and have just reduced their unemployment benefit. It we do likewise we must make up our mind to face hardship. It is easy to say, and even to prove, that many thousands of pounds received in " dole " are spent in cinemas, on horse and dog racecourses, in drinking and gambling ; and wherever you draw your line between necessaries and luxuries, these are not all necessary. But if benefits are reduced by the small sums now recommended, there will be some grim tightening of belts ; there will be some things that would sicken us to see—such as the saving at children's expense by parents too selfish to save first on themselves. (That such parents to-day would be a small minority, we well believe, but they exist.) There is some comfort in the assurance of the Ministry of Labour that the purchasing power of the reduced benefit will be equivalent to the present benefit's power as it was from 1924 to 1928. But that would be small comfort to those who have adapted their living to the present rate.
Then there are the increased contributions which, according to its terms of reference, the Commission finds necessary for a sound scheme. The wage-earner may grumble at paying a trifle more for others less happy than himself and for his own possible benefit, but we believe that he would pay if asked. The employer is also to increase his share of the premium slightly. Any exemption for him would be on cold economic grounds. If one of the chief causes of our industrial depression, apart from depression abroad (we have at last learnt as a country that nations are interdependent as each other's customers), is that the first charges to be met—taxes, rates, insurance contributions—have made it impossible to compete with foreigners having lighter compulsory charges, tlien revival depends on reducing these charges rather then increasing them. Then the contribution of the " State," i.e., of all of us, is to be increased. That probably depends upon the verdict of the Chancellor of the Exchequer, who will be asked whether he can find the money. Let us here remember that in this non- universal scheme most of the State's contribution comes from uninsured people, and that there may be many who have contributed through their taxes more than many an insured person ; and some of these fall out of work and become penniless ; yet however great their contributions have been, they have no claim to benefit.
We ask the country again : can it face a heroic remedy ? Of one thing we are certain. If the Govern- ment, believing it to be right, dares to propose to legis'ate according to the recommendations for which it asked, it must receive the support of all who wish the country well. The signs that some Labour leaders, before as well as after reading the Report, meant to oppose it, have been ominous of prejudiced, not reasoned, resistance. It may be the duty of these leaders, here as in Russia, to lead on into hard and stony paths, and to impart faith in the future. And if the Unionists in opposition should seek a party advantage out of the country's grave case by opposing the Government when it is set upon a right course of intense difficulty, such lack of patriotism would be unforgivable.,
Previous page
